Returning veterans struggle to cover housing costs in U.S. metros

WASHINGTON, DC – July 12, 2012 – (RealEstateRama) — Veterans returning from service face a number of hurdles in readjusting to civilian life. One of the biggest hurdles is finding a job; among young veterans aged 18 to 24, more than 30% are unemployed. But even employed veterans often struggle to meet their basic needs. Despite access to federal job training initiatives and other programs, many of the jobs veterans enter after service offer wages too low to make housing affordable. In this edition of Paycheck to Paycheck, Center for Housing Policy researchers draw on the latest data from the first quarter of 2012 to reveal the gap between wages and the costs of housing, both rental and owned, in more than 200 U.S. metro areas for workers in occupations targeted by job training programs for returning service members, as well as other occupations (74 in all).

“Because many veterans have been off the job market for years while serving multiple tours of duty, they often struggle to find employment,” said Center researcher and report author Laura Williams.

“But as our data show, even those who get a job may not be able to make ends meet,” Williams continued. “In many housing markets, the jobs America’s servicemen and women may find waiting for them after deployment do not pay enough to afford the costs of buying a home, and in some markets and for some occupations, veterans cannot afford the costs of renting a modest rental home.”

An accompanying report, Paycheck to Paycheck 2012: Can veterans afford housing in your community?, explores trends in housing affordability for workers in five of the jobs targeted by veterans’ training programs sponsored by the Department of Labor in partnership with the military and other organizations: carpenters, dental assistants, electricians, firefighters and truck drivers. Of these professions, only one—electricians—offers wages high enough to afford to pay the mortgage on a home at typical prices nationwide, and workers in one of the jobs—dental assistants—cannot afford the typical nationwide rent on a two-bedroom apartment.

Less than half of the 200 metro areas studied in Paycheck to Paycheck offered a fair-market rent on a two-bedroom apartment affordable on a dental assistant’s salary, and in less than a quarter of the metro areas studied could a dental assistant afford the mortgage on a median-priced home. In the most expensive markets covered, even relatively high-earning electricians could not afford the typical rent on a one-bedroom apartment.

“Veterans face a wide range of challenges after returning from deployment,” commented Jeffrey Lubell, executive director of the Center for Housing Policy. “There are many outstanding service organizations across the country that provide assistance to veterans, but their efforts are often undercut by steep housing costs that make it difficult for veterans to make ends meet.”

/httpdocs/media/files/Paycheck%20Summer%202012%20Analysis.pdf">Read the report

Key Findings

Of the five jobs targeted by veterans’ employment training programs highlighted in the report— carpenters, dental assistants, electricians, firefighters and truck drivers —only electricians earn enough on average to afford mortgage payments at typical prices nationwide, and dental assistants cannot afford typical rents on a two-bedroom apartment. However, even an electrician’s salary will not cover the mortgage payment on a median-priced home or even the rent on a typical one-bedroom apartment in the most expensive housing markets.

For more than 70 percent of the metro areas studied, the income needed to buy a median-priced home dropped by three percent or more over the last year, due to a combination of large numbers of foreclosed homes hitting the market after long delays, low interest rates and other local factors. However, in 20 percent of the communities examined, the income needed to purchase a median-priced house held relatively steady, and 21 metro areas, or 10 percent of the areas studied, saw increases of three percent or more.

Some markets run counter to the overall trend of homeownership becoming more affordable. In 21 of the metro areas studied, the income needed to afford a median-priced home increased by three percent or more between the first quarter of 2011 and the first quarter of 2012. In eight of those metro areas—Syracuse, N.Y.; Salisbury, Md.; Lima, Ohio; Ocean City, N.J.; Cape Coral, Fla.; Washington, D.C.; Miami, Fla.; and Akron, Ohio—the income needed to afford a median-priced home rose by ten percent or more over that period. Increases in qualifying incomes in those areas far outpaced typical wage growth.

The Center for Housing Policy gratefully acknowledges the support of the John D. and Catherine T. MacArthur Foundation in funding Paycheck to Paycheck: Wages and the Cost of Housing in America. Any opinions or conclusions expressed, however, are those of the author alone.

About the Center for Housing Policy

The Center for Housing Policy is the research affiliate of the National Housing Conference (NHC) and specializes in developing solutions through research. In partnership with NHC and its members, the Center works to broaden understanding of the nation’s housing challenges and to examine the impact of policies and programs developed to address these needs.

About the National Housing Conference

As the United Voice for Housing, the nonprofit National Housing Conference (NHC) has been dedicated to helping ensure safe, decent and affordable housing for all in America since 1931.

For more than 75 years, the nonprofit National Housing Conference (NHC) has been the United Voice for Housing. A membership drawn from every industry segment forms the foundation for NHC’s broad, nonpartisan advocacy for national policies and legislation that promote suitable housing in a safe, decent environment.

NHC's research affiliate, the Center for Housing Policy, specializes in developing solutions through research. In partnership with NHC and its members, the Center works to broaden understanding of the nation’s housing challenges and to examine the impact of policies and programs developed to address these needs.

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